Chevron's Abusive Litigation in Ecuador

Rainforest Chernobyl Revisited† The Clash of Human Rights and BIT Investor Claims: Chevron’s Abusive Litigation in Ecuador’s Amazon by Steven Donziger,* Laura Garr & Aaron Marr Page** a marathon environmental litigation: Seventeen yearS anD Counting he last time the environmental lawsuit Aguinda v. ChevronTexaco was discussed in these pages, the defen- Tdant Chevron Corporation1 had just won a forum non conveniens dismissal of the case from a U.S. federal court to Ecuador after nine years of litigation. Filed in 1993, the lawsuit alleged that Chevron’s predecessor company, Texaco, while it exclusively operated several oil fields in Ecuador’s Amazon from 1964 to 1990, deliberately dumped billions of gallons of toxic waste into the rainforest to cut costs and abandoned more than 900 large unlined waste pits that leach toxins into soils and groundwater. The suit contended that the contamination poisoned an area the size of Rhode Island, created a cancer epi- demic, and decimated indigenous groups. During the U.S. stage of the litigation, Chevron submitted fourteen sworn affidavits attesting to the fairness and adequacy of Ecuador’s courts. The company also drafted a letter that was By Lou Dematteis/Redux. Steven Donziger, attorney for the affected communities, speaks with signed by Ecuador’s then ambassador to the United States, a Huaorani women outside the Superior Court at the start of the Chevron former Chevron lawyer, asking the U.S. court to send the case trial on October 21, 2003 in Lago Agrio in the Ecuadoran Amazon. to Ecuador.2 Representative of Chevron’s position was the sworn statement from Dr. Ponce Martinez, its lead lawyer in Ecuador for more than three decades: “In my opinion, based upon my vast resources and cadres of loyal and influential operatives in knowledge and expertise, the Ecuadorian courts provide a totally Ecuador built up over decades of operations there, would either adequate forum in which these plaintiffs fairly could pursue their make the case disappear or draw it out endlessly. In 2004, it claims.”3 As a condition of the dismissal, Chevron promised looked as though the case could be an example of how “courts to subject itself to jurisdiction in Ecuador for purposes of the have the potential to re-allocate some of the costs of globaliza- claims, agreed to abide by any judgment from Ecuador’s courts tion — in this case, environmental destruction — from the most subject only to narrow enforcement defenses in the United vulnerable rainforest dwellers to the most powerful energy com- States, and waived statute of limitations defenses.4 Armed with panies on the planet.” Those words were written in this publica- these legally-enforceable commitments, indigenous and farmer tion by one of the authors when assessing the case in 2004, at the communities from Ecuador’s Amazon region, along with their very beginning of the trial in Ecuador that has yet to conclude.5 U.S. and Ecuadorian lawyers, made the bold decision to re-file The ensuing seven years of environmental litigation in the same tort action in Ecuador’s courts. The communities were Ecuador have been far from easy, raising a number of critical committed to seeking redress for human rights abuses that have legal and policy challenges relating to accountability for human decimated indigenous groups and to addressing the broader, rights violations. Most of these challenges stem from Chevron’s related questions of accountability and impunity. Therefore, use of what one observer called a “textbook example of abusive they plowed ahead despite deep concern that Chevron, with its litigation” to forestall resolution of pressing legal claims on which the survival of thousands of people could depend.6 As *Steven Donziger serves as legal consultant to the plaintiffs in the discussed below, Chevron representatives have repeatedly tried Aguinda v. ChevronTexaco case, and has been involved in the litiga- to improperly influence the court and apply political pressure to tion since it began in 1993. coax Ecuador’s government to quash the private lawsuit in viola- **Laura Garr and Aaron Marr Page are also legal consultants for the tion of Ecuador’s constitution.7 Evidence suggests the company Aguinda plaintiffs. is now violating its commitments to a U.S. federal court about its †Steven Donziger, Rainforest Chernobyl: Litigating Indigenous Rights and intentions to abide by a judgment in Ecuador.8 Chevron recently The Environment in Latin America, 11 No. 2 Hum. Rts. Brief 1 (2004). resorted to using a Nixon-style “dirty tricks” sting operation 8 designed to undermine the trial and fabricate evidence of judi- cial misconduct.9 In Ecuador, providing scientific proof has required the communities to assemble and manage teams of environmental experts to produce reports and counter-reports that collectively run into the thousands of pages. The legal side has required just as much effort, not only to determine questions of liability but also to respond to hundreds of motions filed by Chevron to delay the trial over the years. Chevron, having correctly concluded it is far cheaper to litigate than to pay the cost of cleaning up an area the size of Rhode Island, adopted a simple defense strategy: deny, distract, and delay. The company can afford this strategy: it made U.S. $25 billion in profit in 2008 alone. The communities operate under a more terrifying calculus: more than 1,400 cancer deaths due to oil contamination and near-constant exposure to cancer-causing oil hydrocarbons, resulting in damages up to U.S. Donziger. Courtesy of Steven 10 11 $27.3 billion, according to a court-appointed Special Master. The Shushufindi 38 well site. The communities have been buoyed by the fundamental strength of the underlying scientific and technical evidence. were never treated.16 Worse, two former Texaco lawyers, both Any visitor to the region can see the prima facie case in strik- now employed by Chevron, are facing criminal fraud charges ing terms: old Texaco barrels mired in hundreds of giant, in Ecuador for using a laboratory test that made it impossible to unlined, open-air pits of oily sludge that leach their contents via detect anything more than trace amounts of toxins in the soils pipes built by the oil company into nearby streams and rivers. at highly contaminated sites at the time the company secured Carcasses of cows and birds can often be seen floating in the the release.17 The results of this test were reported to Ecuador’s oil muck at well sites built, operated, and closed — but never government to prove the remediation met the required clean-up cleaned — by Texaco. Evidence demonstrates the company standards. never conducted a single environmental impact study or health At trial, Chevron used soil samples lifted far from the con- evaluation in the decades it operated in the Amazon, even though taminated areas as proof that its operation had no environmental thousands of people lived in and around its oil production facili- impact, but this tactic was documented by the Special Master. ties and relied on rivers and streams that the company used to Chevron’s technical team reported that it could not detect con- discharge toxic waste. Hundreds of waste pits left by Texaco tamination at waste pits that resembled lakes of oil sludge, such have been tested extensively by Chevron, the plaintiffs, and as one at a well site called Shushufindi 38. At this site, Chevron various third parties, revealing levels of total petroleum hydro- reported a “no detect” based on a laboratory analysis of a ran- carbons and heavy metals hundreds and sometimes thousands of dom soil sample of dirt lifted from surrounding forest far away times higher than allowable norms in Ecuador and the U.S.12 In from the waste pit. This sampling result and others like it were fact, Chevron’s own documents prove that, as the communities used as the basis for a technical report submitted by Chevron have long alleged, Texaco never re-injected or safely disposed as evidence to the court that concluded the site posed no risk of “produced water,”13 and instead directed it via an elaborate to human health.18 Chevron also claims that the contamination system of pipes into surrounding streams and rivers which local is really the fault of the current operator of the oil fields, state- residents still use for drinking and bathing.14 owned Petroecuador. However, this has proven to be both factu- The communities have successfully rebutted Chevron’s ally false, according to company records and field samplings defenses as factually false and legally inadequate. For example, that reveal contamination at sites never touched by Petroecuador, after Aguinda was filed in 1993, Chevron decided, without con- and legally insufficient, because the concept of joint and several sulting with the communities, to remediate a small portion of liability applies to remediation cases precisely in order to pre- the contaminated sites in exchange for a release from Ecuador’s vent the general public from having to foot the bill to clean up government. The release expressly excludes the private claims contamination that once benefited a polluter. in Aguinda; yet, as the case was pending in U.S. court, Chevron There have been myriad other obstacles related to Chevron’s argued that the release covered those claims and that the case effort to use its political muscle to terminate the Aguinda case. should be dismissed based on the purported clean-up.15 Though In the United States, the company employs six public relations the U.S. district court never accepted this argument, Chevron firms and roughly one dozen lobbyists to handle the Ecuador still reaps huge public relations benefits and buys years of issue, leading one Congressperson to accuse the company of time by litigating the “release” issue repeatedly in various fora engaging “in a lobbying effort that looks like little more than and using it to claim that the very existence of the lawsuit in extortion.”19 The lobbyists, who include former high-level Ecuador is a violation of its contractual rights.

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